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Cerberus: Gove is right to say we have to leave the single market


Abnormal service is about to be resumed. After the brief lull occasioned by Super Thursday’s round of elections, the titanic battle over Britain’s European destiny, now intimately entwined with the future leadership of the Conservative government, will again take centre stage.

The big guns are being unleashed. Yesterday, in the TV studios George Osborne and Michael Gove clashed over post-Brexit trading arrangements, with the Justice Secretary displaying his customary lucidity and confirming that in such a world Britain would leave the single market (and its insistence on free movement of people) while retaining access to it. Osborne predicted another plague of frogs, saying that quitting the single market would be “catastrophic” for jobs, incomes and livelihoods.

Piling on the agony, the Chancellor also claimed that a vote to leave would drive up interest rates and drive down property prices – another doom-laden prophecy rather undermined by the Bank of England briefing the Sunday papers that Brexit would trigger a rate cut to head off a slowdown.

Gove was right to make clear that Brexit meant exit from the single market – a question that Boris Johnson failed to answer in his Andrew Marr interview a few weeks ago. If this referendum is about anything it is about Britain’s right to reassert itself as a self-governing country free to operate its own border controls and decide who comes here and who does not. You cannot complain about uncontrolled immigration and in the same breath commit to remaining a member of the single market.

But you don’t have to be a member of the single market to have access to it, as Gove rightly pointed out. As many experts have said, the default option post-Brexit is WTO rules, which impose only small trade tariffs. It would be perfectly possible for a Britain outside the single market to negotiate its own trade deal with the EU on better terms than the WTO fallback. This is particularly true given that EU countries export far more to Britain than we export to them. Or are German carmakers and French winemakers going to commit commercial suicide?

Nor has membership of the single market proved such a boon for Britain as is commonly supposed. Three months ago, former Tory minister David Davis pointed out that although entry to the Common Market in the 1970s boosted British trade to the Continent, over the last 20 years, during the single market era, the performance of British exports to the EU had been no better – and in some cases worse – than that of non-EU countries trading with Europe. Reductions in EU external tariffs and the growth of Brussels red tape appear to explain the discrepancy.

But yesterday’s skirmishing over trade and the economy in the TV studios is only the beginning. Today, the Prime Minister will try to make our flesh creep by outlining the “patriotic” case for staying in the EU, insisting that it helps keep us safe. Isn’t that Nato’s job? We have heard rather less of this “security” argument for EU membership since the murderous Brussels bombings in March and widely reported European intelligence and policing failures, suggesting that the borderless EU is far from being a shield against terrorism.

At the same time, Boris will back up Gove by turning his attention to the shortcomings of the much vaunted single market. A couple of days later, he will do what he’s best at, embarking on a nationwide month-long bus tour to bang the drum for Brexit.

The campaign is hotting up. Remain sees the economy as its strongest suit and has decided to risk playing the more contentious card of security, wheeling out former spy chiefs to back up its case. Leave is trying to neutralise Remain’s edge on the economy, while deploying its star campaigner to drive the independence message home across the country.

And no one lacks an incentive to join the battle. Cameron and Osborne know they are toast if Brexit triumphs. Boris and Gove know there is a glittering prize in view.

(Image: Policy Exchange)

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Cerberus writes a blog every Monday on the state of modern Britain.

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